Speech by Minister Chan Chun Sing at the Quality and Standards Conference

Speech by Minister Chan Chun Sing at the Quality and Standards Conference


A very good morning to all of you.


1          Let me start with three very simple questions. The first question, when you shop for food items at a supermarket, how many of you choose the cheapest, and why? The second question, what is the similarity between a company like Tecsia, Freshening Industries, EY and Keppel? Four very different companies, in four very different industries – besides the fact they are Singapore companies or based in Singapore. Last question, why did VHS became the standard for video recording instead of Beta-Max, which technology buffs will tell you is the better technical standard by far?

2          Let me first congratulate and thank ESG, Singapore Standards Council and the Singapore Accreditation Council for organising this conference. I have been told that you organise this every two years for like-minded partners like yourselves to discuss issues relating to quality and standards and to make a push for it. And I have always been reminded that at such conferences, I am often talking to the converts. Having said that, I hope you will eventually become the evangelists.

Overcoming Challenges as a City-State

3          When I took over MTI, one of the first questions that I always ask myself is, how do we, Singapore, as a small country with finite resources, manpower and land area, be able to continue to grow, thrive and create good jobs for our people. And it is not easy, most economists will say that beyond a certain economical stage of development, mature economies will gradually slow down. Mathematically it is true, economically it is expected to be so. But for us, the challenge is quite internal. While the growth of matured countries slows down, we are both a country and city-state. A city by definition, cannot grow very slow, otherwise it will become history soon enough. A city by definition, will always be a magnet for talent, ideas, business opportunities and so forth, so cities tend to grow faster than the average country. For Singapore, we have this dilemma - how do we as a city-state grow fast and yet not be subjected to our inherent constraints and the challenges of a maturing economy. I have always found the answers in about three areas.

4          First, we have always pushed for the need to look beyond Singapore, to explore the international market, use the world as our global hinterland. But going international is never easy, it means we are confronted by different market demands, different needs and different expectations. But therein also lies opportunities. So that is the first strategy that we always remind ourselves of, to look beyond the Singapore market.

5          The second strategy we always talk about in our economic development, is that we must find ways to transcend our geography and size. And today’s topic is quite apt. In the past, economic competition is always determined by the size of the land, the labour pool and so forth. And over time, we talk about the quality of our people and the quality of our talent. But today, technology and the world have changed. Even a small country, a city-state like Singapore, can have tremendous opportunities not based on our size or location, but based on our connectivity and our ability to seize opportunities in the non-physical dimensions of the new economy, in digital, in finance and so forth. These are what we mean by the non-physical dimensions of connectivity. In the past, Singapore depended very much on our air, land and sea connectivity to connect with the world’s markets and resources. Today, over and beyond the air, land and sea connectivity, we depend on data, financial, talent, and technology connectivity to transcend our geography - that is the second thrust. Internationalisation, leveraging new technology and economies, and technology and connectivity.

Quality and Standards as A Necessary Competitive Advantage

6          There is a third strategy that will always put us in a good stead in competing with the rest of the world, serving the rest of the world with our products and services, and that has to do with today’s conference – Quality and Standards. Quality and Standards is not something that is good to have. For us, it is almost a necessary competitive advantage. But this is not a natural competitive advantage that will come naturally to everyone. It is something that we have to nurture, something that we have to work hard on, something that we have to grow and zealously guard because all these has to do with the branding of quality, assurance, and the brand of trust. A brand that speaks about the kind of products and services that Singapore have.

7          So let me go back to the three questions. The first, you all know the answer better than me - we do not just go to the supermarket and buy any product, or for that matter we do not just walk into any shop to buy IT products. When you choose your new smart phone, why do you choose certain brands? Because those brands are associated with quality, and they give you after-sales service and quality assurance. And because of that, they command a premium. The premium depends on the products, but by any measure, it can sometimes be a 20% to 30% premium. Recently, I talked to one of the big oil majors and asked why do they put their investment in Singapore, because in Singapore, we neither have oil nor any big markets. The big markets are not here, but we produce up to one-third of the global capacity for various high-end petro-chemical products. And this particular Chairman told me that we were able to beat the competition to attract the multi-billion-dollar investment to Singapore even though our price was not the lowest, and the difference between us and the next competitor was more than 10%. This serves yet another reminder to us how important it is when we have Quality and Standards that people can trust.

8          And for the second question on  the similarity between EY and Keppel,  EY is in the professional services and we know that professional services have no geographical boundaries or insulation. It is a worldwide competition. Today, professional services companies from elsewhere can come and compete in Singapore. Likewise, our companies can compete elsewhere in other parts of the world beyond the traditional jurisdictions. Anything on the cyber platform can be equalised and competed on the same level, playing field. The only reason that many other countries continue to use professional services in Singapore, is our Quality, the Standards we adopt, and also the brand of trust over and beyond all the adjacency services that we provide. Today if you are in the accountancy business, you will know that it is not enough just to provide pure accountancy services. You will require wrap-around services, but most importantly, people shop around just as we shop around in shopping centres to look for products and services that give them the assurance of Quality and Standards. And so, we have to find different ways to make this our competitive advantage. I had visited Keppel, and they proudly told me that they have created some new Guinness World Records by assembling 21 oil rigs in one year. I was totally amazed. I looked at them, their shipyard, and the coast line of Singapore and I thought to myself, how do we even have enough space to park and build 21 oil rigs in one year. And they told me the secret - they do not produce every part of the oil rig here. In fact, the building of the modern oil rig is a bit like Lego building blocks. Parts are built across the entire globe, but the most important part is done in Singapore, the part where they integrate all the components and assemble them together. Then I said, this cannot be our competitive advantage, surely we cannot be a turnkey producer like many other companies. This is where I missed the point. Why are all the products and services integrated in Singapore? Because of Standards and Quality issues. So they said that they do not produce every part of the 21 oil rigs here but when it is finally assembled, tested, certified and accredited in Singapore, there is a price premium. This is also the similarity between Keppel, EY, Freshening Industries and Tecsia.

Collective Effort in Developing a Trusted, Singapore Brand

9          Last but not least, I’d like to encourage all of you to work together. For the question on Beta-max versus VHS, very often in the history of products, it is not always the best that will win. It is often the one that is the fastest and with the widest adoption rate that will find an edge. Because once standards are established and proliferated, the rest will come to join the bandwagon. What we call the first mover advantage is critical, and this is where today’s conference is important. Today’s conference is not just about urging every one of us to do better. The next step is for you to become evangelists. But as an evangelist, working alone is not enough, we need to build that Singapore brand together. This is the same for accounting standards, food standards and for various and emerging technological standards for example, the growing market for autonomous vehicles or even a single thing like electrical charging for vehicles. Standards are important, if we can get our act together and work with like-minded partners both in Singapore and in the region, once we can get those standards up and going, it will give us a competitive edge. When I was in the NTUC, I urged the Singapore Institute of Safety Officers (SISO) to work on the Singapore safety standards. There are many safety standards across many industries, and the reason I always encourage them to do so is because we want to establish our standards that is trusted by people so that it can become a competitive advantage for our companies to create good and better jobs for our people. So these are all the very important reasons why we are gathered here.


10        We are gathered here because we hope that all of you will help us spread the message and I think that is the easiest part because every businessman knows that if we have the brand, the quality assurance and the standards, we all get a premium because nobody walks down the supermarket aisles just to buy the cheapest thing without thinking about quality assurance. And in Asia’s emerging market, for the middle class, it is not quantity but the quality that matters. Secondly, regardless of whether we are in the product or services line, we need to have the brand called Singapore, where we collectively build the trust of other people to want to adopt our standards and buy our products. Last but not least, how fast we come together to proliferate the standards that can be trusted by people in Singapore and beyond will become a significant competitive advantage, especially in the fast moving technological realm because if we do not move fast enough together, someone else will establish those standards, and we may become the Beta-Max rather than the VHS.

On that note, I thank you very much for your attention and I congratulate all the winners today. Thank you. 

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